By The Editorial Board
7/14/15
http://www.gloucestertimes.com/opinion/our-view-baker-right-to-rein-in-state-borrowing/article_5708afe9-2fdb-507c-b18a-6f80e56e2992.htmlAfter several rounds of spending cuts and other austerity measures to counteract a $768 million budget deficit brought about by the profligate spending of the Deval Patrick era, one would think Massachusetts lawmakers would commit themselves to being better stewards of the people’s money.
One would be wrong.
Democratic legislators are already complaining that Gov. Charlie Baker isn’t borrowing enough money to spend on pet projects in their home districts. They say they are offended and confused by the administration’s approach to money management.
The disagreement stems from the Baker administration’s conservative approach to borrowing, one that doesn’t increase the state’s debt cap. It’s an approach we feel is best for Massachusetts and its taxpayers.
Baker’s $4.1 billion capital spending plan for fiscal year 2016 would help pay for improvements to state highways, building maintenance projects and renewed economic development. The plan calls for $2.125 billion in general obligation funds, according to the State House News Service. That’s the same as fiscal year 2015 and the first time in six years the executive branch hasn’t increased borrowing by $125 million.
“The more money we borrow now, the less we have available in the operating budget to spend on discretionary spending and the capital program, as you know, has grown significantly in the last few years,” Kristen Lepore, Baker’s administration and finance secretary, told lawmakers at a hearing earlier this month.
Lepore said the administration’s spending plan was “responsible,” especially in light of the fact that borrowing has increased by 64 percent over the past decade.
It’s a sensible approach, a point that was lost on lawmakers.
State Rep. Antonio Cabral, a New Bedford Democrat, said state revenues are growing.
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We say Baker is keeping a campaign promise to spend the taxpayers’ money like a responsible adult.
Baker’s sober approach comes as a new study ranks Massachusetts 48th out of the 50 states in financial health, as determined by short- and long-term debt and other obligations, including unfunded pension and retiree healthcare liabilities.
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On a long-run basis, Massachusetts’ liabilities exceeded total assets by 47 percent. The state also carried a higher level of bonded debt than the national average. Unfunded pension liabilities were significant at more than $89 billion, close to three times the state’s estimates.”
Yes, the economy seems to be on the rebound. But Norcross says that’s no reason to abandon prudent borrowing and spending policies:
“Even states that appear to be fiscally robust — perhaps owing to large amounts of cash on hand or revenue streams from natural resources — must take stock of their long-term fiscal health before making future public policy decisions.”
That’s exactly what the Baker administration is doing, and he deserves support, not scorn, from the Legislature.
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